Socal housing market could be stabilizing

June home sales for both Southern California and L.A. County were down compared with the previous month and with June, 2012 even as median prices continued to skyrocket, Dataquick reports. L.A.'s median price in June was $425,000, a 32 percent jump from a year earlier. For months now, this has been a frenzied market, with too many buyers (often willing to pay all cash) and too few sellers. That's created bidding wars for the more desirable properties on sale - and left those wanting to finance pretty much out in the cold. But Dataquick notes that buyers paying with cash fell slightly in June and lending activity is picking up. Also, there are signs that more homes are being put on the market, which is really what's needed in order to create better parity between sellers and buyers. A single month does not make a trend, but these adjustments bear watching. From press release:

"This market's getting really interesting. Rates have shot up enough to put a dent in housing affordability. Investor and cash buyers are starting to back off a bit, while there's evidence the supply of homes on the market, while still thin by historical standards, has risen meaningfully. We saw an amazing pop in home prices over the last year. Now we see signs suggesting that blistering pace won't persist. We continue to believe that a 'supply response' to the run-up in prices will gradually tame price appreciation. If mortgage interest rates shoot up again then that's virtually a given," said John Walsh, DataQuick president.